Fortinet Inc. (NASDAQ:FTNT) Q3 2019 Earnings Conference Call Transcript

Oct 31, 2019 • 04:30 pm ET

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Fortinet Inc. (NASDAQ:FTNT) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by and welcome to the Fortinet Q3 2019 Earnings Announcement call. [Operator instruction] After the speaker presentation, there will be a question-and-answer session. [Operator Instructions].

I would now like to hand the call over to your speaker, Mr Peter Salkowski, Vice President of Investor Relations. Please go ahead, sir.

Executive
Peter M. Salkowski

Thank you, Sherry [Phonetic]. Good afternoon and Happy Halloween, everyone. This is Peter Salkowski, Vice President of Investor Relations of Fortinet. I am pleased to welcome everyone to our call to discuss Fortinet's financial results for the third quarter of 2019. Speakers on today's call are Ken Xie, Fortinet's Founder, Chairman and CEO; and Keith Jensen, CFO. This is a live call that will be available for replay via webcast on our Investor Relations website. Ken will begin our call today, providing a high level perspective on our business. Keith will then review our financial and operating results, providing our guidance for the fourth quarter and update our 2019 guidance, before opening the call to your questions.

During the Q&A session, we ask that you please keep your questions brief and limit yourself to one question and one follow-up to allow others to participate. Before we begin, I'd like to remind everyone that on today's call we will be making forward-looking statements and these forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those projected, please refer to our SEC filings, in particular the risk factors in our most recent Form 10-K and Form 10-Q for more information.

All forward-looking statements reflect our opinions only as of the date of this presentation, and we undertake no obligation and specifically disclaim any obligation to update forward-looking statements. Also, all references to financial metrics that we make on today's call are non-GAAP, unless otherwise stated. Our GAAP results and GAAP to non-GAAP reconciliation is located in our earnings press release and in the presentation that accompany today's remarks, both of which are posted on our Investor Relations website. Lastly, all references to growth are on a year-over-year basis, unless noted otherwise.

I will now turn the call over to Ken.

Executive
Ken Xie

Thanks, Peter, and thank you to everyone for join to this call to review our third quarter 2019 result. We are pleased with our strong pillars port [Phonetic] on the service revenue, operation margin and the free cash flow performance in the third quarter. Contributing to our strong third quarter result, we all advanced 48 PO-driven [Phonetic], FortiGate technology. Integrated Security fiber solution, hybrid and multi-cloud offerings and a significant adoption of our secure SD-WAN solution.

Total revenue was up 21% to $548 million and the quarter revenue accelerated to 20% growth. During the third quarter Fortinet was named the leader for the third consecutive year in the Gartner Magic Quadrant for network firewall. Mutual [Phonetic] condition validate our advantage enable the enterprise customers to create a secure driven network that deliver integrated and automated security to all network